Spotify will raise subscription fees in France in response to a new music-streaming tax

Spotify intends to raise subscription prices in France due to a proposed levy targeting music-streaming services in the nation.

Three months after promising to start divesting in France, the corporation has taken action by withdrawing backing from two events, hinting at more to come.

Implemented on January 1, a tax of 1.2% will be applied to Spotify and competing services like Deezer, Apple Music, and Google’s YouTube Music. The funds collected will be sent to the Centre National de la Musique (CNM), which was created four years ago to assist the French music industry. Spotify has been the most vocal in criticizing the new regulation since it is the largest company in the nation.

Confidential
Spotify has not disclosed the exact amount of the price increase. However, it said that from now on, French consumers would have the highest membership costs in the European Union (EU). The company intends to notify subscribers about the upcoming price increase gradually. It appears that part of the strategy is to generate enough consumer concern to influence those in authority. However, with the law already in effect, it is unlikely that there will be any immediate changes.

In a blog post today, the business stated:

“With the creation of this new tax, Spotify would be required to give approximately two-thirds of every euro it generates to music to rights holders and the French government. Of course, this is a massive amount and does not allow for a sustainable business. As we have long said, we simply can’t absorb any additional taxes.”

According to a Spotify official speaking to, the company is informing consumers about an upcoming price increase in an effort to be honest. Despite their efforts to prevent it, the price raise was unavoidable.

Market size
The most significant aspect of this whole situation is the crucial role that France plays in Spotify’s commercial success. Its reaction here varies somewhat from its reaction to a similar discussion in Uruguay, which is likewise in the midst of enacting new legislation that guarantees “fair and equitable” compensation for all artists participating in a recording. Spotify initially announced its intention to completely withdraw from Uruguay due to concerns that a new law would require it to pay royalties twice for the same songs. However, after receiving assurances from the Uruguayan government that music-streaming platforms would not incur additional expenses because of the law, Spotify decided to reverse its decision to pull out.

Spotify is expressing significant dissatisfaction with the increased tax in France, similar to its reaction in Uruguay, but has not shown any intention of leaving the nation. Despite claiming to be effectively compensating artists twice, comparable to Uruguay, Spotify prefers to raise its pricing rather than threaten to leave the nation.

Spotify announced in December that it was discontinuing its financial and resource support for the Les Francofolies de la Rochelle and the Printemps de Bourges festivals. Spotify is raising its subscription pricing to cover the expenses of a tax, stating that this price rise would help achieve that goal.